SALDIVAR TORRES vs. GMRI, INC.

For the reasons set forth below, the Court intends to grant the motion for approval of the parties’ PAGA settlement. However, this is conditioned on the parties agreeing to exclude Labor Code § 1102.5 from the scope of the PAGA predicates released. If the parties are unwilling to make this change to the agreement, the Court is inclined to deny approval.

Assuming the parties agree to submit a revised settlement agreement (and corresponding revisions to the notice), the Court will hold a further hearing on June 5, 2026 at 9:00 a.m. in Department CX101 to finalize awards of attorney’s fees, litigation expenses, administrative expenses, and a service award for Plaintiff. In advance of the hearing, Plaintiff is to submit a declaration by May 27, 2026 addressing the service award factors discussed in Golba v. Dick’s Sporting Goods, Inc. (2015) 238 Cal.App.4th 1251 and Clark v. Am. Residential Servs. LLC (2009) 175 Cal.App.4th 785.

GROUNDS FOR RULING

I. Garcia and Rodriguez Objections

The Court previously denied the motion of the Garcia and Rodriguez plaintiffs (collectively, “Objectors”) to intervene, citing Turrieta v. Lyft, Inc. (2024) 16 Cal.5th 664. Despite this, Objectors responded to the most recent order by once again raising objections to the settlement. They contend footnote 7 of Turrieta supports the Court’s consideration of their objections because Turrieta declined to address whether a competing PAGA plaintiff has a right to have his objection considered when there are nonoverlapping claims. This misreads footnote 7.

The Supreme Court, like the appellate court before it, “declined to consider Olson’s contention that Turrieta settled claims she was not deputized to pursue.” (Id., at p. 684, fn. 7.) However, in an abundance of caution, the Court exercises its discretion to consider these Objectors’ objections. (See id., at p. 715 (leaving open the question of whether courts have discretion, rather than an obligation, to consider objections of competing plaintiffs).)

A. PAGA Standing

Objectors offer four reasons Plaintiff lacks standing to settle the claims at issue. While these reasons may bear on a reverse auction analysis, the Court disagrees with Objectors about standing.

1. Labor Code Sections Not Cited

The release in the settlement agreement covers claims for civil penalties under PAGA “arising during the applicable Settlement Period that were asserted in Action or that could have been asserted in the Action based on facts and theories alleged in the Action” or the various LWDA notices. (Settlement at 7.) Objectors contend Plaintiff cannot settle PAGA claims he could have, but did not assert based on the facts pled in his LWDA notices. The Court disagrees.

PAGA plaintiffs routinely settle not only predicate violations specifically identified in LWDA notices, but also predicate violations that could have been asserted based on the facts contained in the notices. Indeed, section 5.2 of the widely-utilized Los Angeles County Superior Court model PAGA settlement provides that aggrieved employees release “all claims for PAGA Penalties that were alleged, or reasonably could have been alleged, based on the facts and allegations in the Operative Complaint that are alleged to have occurred during the PAGA Period and the PAGA Notice.” While not necessarily determinative, the Court seriously doubts that every single PAGA settlement using the Los Angeles form agreement includes an illegally overbroad release of claims.

2. LWDA’s Notice of Investigation

Objectors contend the LWDA’s notice of investigation deprives Plaintiff of standing. This argument appears to have been copied and pasted from earlier briefing, as it refers to dates that have long since passed. In any event, to the extent the notice of investigation may have deprived Plaintiff of standing, the LWDA’s subsequent notice of intent not to issue a citation (ROA 254) resolved that issue.

3. Statute of Limitations

Objectors contend Plaintiff lacks standing to settle claims for most of the proposed settlement periods, as these periods extend beyond one year and sixty-five days before Plaintiff filed suit. Objectors are incorrect. “Nothing in the statute prohibits [a plaintiff] from releasing PAGA claims outside the limitations period of her own claim. Nor is this practice contrary to PAGA’s purposes.” (Amaro v. Anaheim Arena Management, LLC (2021) 69 Cal.App.5th 521, 541.)

4. Claims in Amended Notices

Finally, Objectors contend Plaintiff lacks standing to settle any predicate violations first identified in his amended notices, and to settle against any employer first identified in those notices. Insofar as this argument is based on the LWDA’s notice of investigation, it fails for the reasons discussed above.

Insofar as this argument is based on Plaintiff’s alleged failure to show the relation back doctrine applies, relation back is a doctrine that allows a plaintiff to avoid a statute of limitations defense. “‘In civil cases, the statute of limitations is not jurisdictional but merely serves a procedural function and constitutes an affirmative defense that is waived unless pleaded and proved.’” (Ibid.) GMRI isn’t asserting the statute of limitations as a defense, so there is no need for Plaintiff to prove relation back.

To the extent this argument is based on an alleged failure to provide the LWDA a file-stamped copy of an amended complaint that includes all new predicate violations and names of employers, the statute cited by Objectors appears to have no such requirement. (See Lab. Code § 2699(s)(1) (requiring a plaintiff to provide the LWDA a file-stamped copy of the complaint within ten days of “commencement of a civil action pursuant to this part”).)

Finally, insofar as Plaintiff settled claims before the statutory notice process was complete, the process has indisputably been complete for quite some time. The purpose of the notice process—giving the LWDA a chance to investigate an employee’s claims—was fulfilled when the LWDA in fact conducted an investigation. Again, this sequence of events may bear on a reverse auction analysis. But Objectors cite no authority for the proposition that this sequence of events would deprive a PAGA plaintiff of standing.

B. Reverse Auction

Objectors contend the settlement is the product of a reverse auction. For reasons discussed in the Court’s prior tentative ruling, this is hardly an idle concern. Nonetheless, as Objectors’ counsel at Lawyers for Justice are aware, the fact that a settlement may be the product of a reverse auction will not, by itself, prevent this Court’s approval. (See Garcia v. Group 1 Automotive, Inc., No. 16-00877890, at ROA 573, p. 5, in which this Court approved a PAGA settlement negotiated by this law firm despite evidence that “strongly point[ed] to improper collusion between [the defendant] and [Objectors’ counsel’s client].”)

The Court’s job is to “determine whether [a settlement] is fair, reasonable, and adequate in view of PAGA’s purposes to remediate present labor law violations, deter future ones, and to maximize enforcement of state labor laws.” (Moniz v. Adecco USA, Inc. (2021) 72 Cal.App.5th 56, 77.) Even a settlement obtained through a reverse auction can meet this standard if the amount offered in consideration is otherwise sufficient. Put another way, the fact that a better settlement might be possible doesn’t necessarily mean the settlement before the Court is inadequate.

C. Valuation

Objectors take issue with Plaintiff’s valuation of the case. The Court addresses valuation below.

II. DLSE’s Objections

The Division of Labor Standards Enforcement (“DLSE”), on behalf of the State, also objects to the settlement. The PAGA claims at issue belong to the State, not Plaintiff or Objectors. (See Amalgamated Transit Union, Local 1756, AFL-CIO v. Superior Court (2009) 46 Cal.4th 993, 1003.) As a result, DLSE’s comments are a factor considered in the Court’s analysis.

That said, the Court is concerned about whether DLSE has sufficient basis or information to raise objections. As noted above, DLSE issued a notice of investigation. It appears, however, that DLSE’s investigation was limited to speaking to counsel for Plaintiff, Defendant, and Objectors, and gathering some documents from each. From the Court’s review of the record, DLSE doesn’t appear to have conducted any independent investigation of its own. And while DLSE objects to approval of the settlement, it declined to cite GMRI for violating the Labor Code. (ROA 254) If DLSE had serious concerns about the amount of penalties Plaintiff proposes to recover, then one option would have been to issue citations and penalties itself following its investigation.

Moreover, the Court has concerns about how DLSE came to be involved in this matter. It appears Objectors’ counsel at Lawyers for Justice reached out to DLSE to complain about the settlement. This is fine so far as it goes: the Court sees no problem with parties attempting to alert DLSE to potentially problematic settlements of PAGA claims. But in this case, the record suggests Objectors’ counsel is using DLSE’s involvement as a lever to extort a higher settlement from Defendant.

In voice mails left for defense counsel, an Objectors’ counsel called defense counsel “despicable,” said ignoring him would “cause your problems to get worse,” and threatened “catastrophic, consequential, existential consequences” for GMRI if the case didn’t settle on Objectors’ terms. (See ROA 312, Exs. A-C.) In each of these voice mails, the counsel suggested that settling with him would result in DLSE withdrawing its objections. And in his final voice mail, the counsel said he was “willing to be extremely reasonable” in settling “any other cases on your docket,” suggesting he was willing to offer lower settlement amounts in cases involving his other clients provided defense counsel was willing to meet his terms in this matter.

To be clear, the Court by no means intends to suggest that DLSE shares the apparent motivations of Objectors’ counsel. The Court merely observes that DLSE’s involvement is potentially being exploited for other purposes.

In any event, DLSE’s objections appear to be based largely on hearsay. For example, DLSE believes Objectors’ counsel conducted a more thorough investigation than Plaintiff’s. The evidence for this assertion is simply what “[o]bjecting plaintiffs’ counsel reported to DLSE.” (Kirkham Decl. (included in ROA 303) ¶ 3.) The Court hardly can put much weight on what DLSE’s counsel says Objectors’ counsel told her.

DLSE includes declarations from six aggrieved employees who testify they regularly suffered the wage-and-hour violations complained of, but these are only six of over 70,000 employees. The Court has already expressed concern with Plaintiff’s counsel interviewing only 112 employees. Six employees is an even smaller sample.

That said, DLSE raises an important objection regarding investigation of the retaliation predicate (Labor Code § 1102.5). The Court previously questioned whether Plaintiff’s counsel had adequately investigated this claim, which carries civil penalties of up to $10,000 per violation, in order to release it as to 70,000 employees. Plaintiff’s counsel provided DLSE with a copy of the “interview script” used to interview GMRI’s employees. The script includes no questions about retaliation. (See generally Kirkham Decl., Ex. B.) Plaintiff’s counsel testifies that his firm “specifically asked each person if they ever felt they were retaliated against” (ROA 295, ¶ 21), but the Court does not credit this testimony in light of the interview script.

Accordingly, the Court will not permit the release of claims for civil penalties under PAGA based on retaliation, and the settlement must be amended to reflect this. If Plaintiff and GMRI are unwilling to make this change, the Court is inclined to deny approval of the settlement.

III. Concerns Regarding Brands and Settlement Periods

The Court previously expressed concern about discrepancies between the restaurant brands listed in Plaintiff’s LWDA notices and the restaurant brands listed in the settlement agreement. There appears to be no dispute that all aggrieved employees, regardless of restaurant brand, are (or were) formally employed by GMRI.

Plaintiff’s counsel testifies that since the inception of the case, the intent has been to pursue PAGA claims regarding all GMRI employees. Plaintiff’s first notice also listed Olive Garden because Plaintiff worked at an Olive Garden restaurant. (ROA 295, ¶ 5.) After further investigation, counsel found that GMRI operated other brands. Plaintiff therefore filed an amended notice that listed all brands operated by GMRI. This would prevent any argument that the aggrieved employees should be limited to GMRI employees who worked at Olive Garden. (Id., ¶ 7.) Finally, after further exchange of information prior to and during mediation, counsel determined that the Chuy’s, Cheddar’s Scratch Kitchen, and Bahama Breeze brands did not exist in California during the relevant time period. As a result, these brands are omitted from the settlement agreement. (Id., ¶ 8.) This explanation satisfies the Court’s concerns.

The Court also expressed concern about the differing settlement periods for each brand. Counsel explains that the start dates for Yard House and Ruth’s Chris Steak House are based on the release periods in prior settlements. (Id., ¶¶ 10-11.) The start dates for Eddie V’s, Seasons 52, Capital Grille, and LongHorn Steakhouse are admittedly tied to the limitations period in Garcia. (Id., ¶ 12.) That is, they were negotiated by Defendant to extinguish the Garcia claims.

Finally, the start date for Olive Garden is tied to the limitations period in the previous Liggins action. As discussed in the Court’s prior tentative ruling, GMRI prevailed in the arbitration of the Liggins plaintiffs’ individual PAGA claims, and judgment was entered in GMRI’s favor. As of this date, no employee of GMRI could possibly bring a PAGA claim extending to the beginning of the Liggins limitations period, meaning neither the State nor any aggrieved employees could recover civil penalties for Labor Code violations occurring between June 6, 2017 and November 6, 2019 (the start of the Garcia limitations period). Tying the start date here to the Liggins limitations period permits recovery of civil penalties that are otherwise unrecoverable. (Id., ¶ 13.)

The Court has no concerns with the Yard House and Ruth’s Chris Steak House start dates, which were effectively set by other settlements. The extent to which the remaining start dates are set specifically to extinguish the claims in Garcia continues to give the Court pause. However, class and PAGA settlements are often crafted to put an end to competing cases. This, by itself, is not reason to deny approval.

IV. Valuation

As noted in the prior tentative ruling, GMRI provided robust documentary evidence to Plaintiff’s counsel prior to mediation. The Court has no concerns with Plaintiff’s valuation of the recordbased claims; there was more than enough evidence for Plaintiff to determine a proper settlement value for them.

The Court previously expressed concern about the adequacy of interviews conducted by Plaintiff’s counsel. Counsel testifies that his firm retained a consultant to compile a contact list of employees. The consultant eventually provided a list of 425 employees. (Id., ¶ 14.) Counsel attempted to contact all 425 employees. Of those, 112 agreed to be interviewed. Counsel and staff (from partners to paralegals) collectively spent hundreds of hours conducting interviews. (Ibid.) Based on these representations, and based on the interview script included with the DLSE’s papers, the Court is satisfied that counsel’s interviews were sufficient to value the non-record claims generally (with the exception of retaliation).

The Court also expressed concern that the makeup of the 112 interviewees might not give an adequate picture of practices across various restaurant brands. For example, practices might be different at Olive Garden than at Capital Grille. Counsel explains that 61% of those interviewed were Olive Garden employees, 3% were Capital Grille employees, 3% were Eddie V’s employees, 3% were LongHorn Steakhouse employees, 9% were Ruth’s Chris Steak House employees, 2% were Seasons 52 employees, and 19% were Yard House employees. (Id., ¶ 16.) This largely tracks the makeup of the record sample turned over by Defendant prior to mediation. If anything, Olive Garden employees are underrepresented in the interviews, and most of the other brands are overrepresented. Furthermore, the overall employee sample was about 60% front-of-house and 40% back-of-house employees. (Id., ¶ 17.) This sufficiently addresses the Court’s concerns about whether the sample was representative across brands and job descriptions.

Finally, the Court previously expressed concern about the release of Labor Code §§ 206.5 and 1199, and whether counsel had considered that the settlement potentially released criminal liability without the involvement of the Attorney General or a relevant District Attorney. The release language in the agreement has been amended to omit § 1199 entirely and to clarify that the release of § 206.5 doesn’t extend to criminal actions. (See ROA 295, Ex. D, at ¶ 29.) This satisfies the Court’s concern.

V.

Conclusion

Again, the Court’s job is to “determine whether [a settlement] is fair, reasonable, and adequate in view of PAGA’s purposes to remediate present labor law violations, deter future ones, and to maximize enforcement of state labor laws.” (Moniz, supra, 72 Cal.App.5th at p. 77.) That a larger settlement might be possible does not mean the settlement before the Court is necessarily inadequate. With the benefit of additional briefing, the Court believes the settlement at issue meets the Moniz standard, provided, however, that the parties must agree to remove Labor Code § 1102.5 from the scope of the release before approval will be granted.